NRG Analyst Day 2018

128 Pages·2017·3.14 MB·English

by  Christensen, Meagan

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SA F E H A R B O R
In addition to historical information, the information presented in this presentation includes forward-looking statements within the meaning of Section 27A of the Securities Act of
1933 and Section 21E of the Exchange Act. These statements involve estimates, expectations, projections, goals, assumptions, known and unknown risks and uncertainties and
can typically be identified by terminology such as “may,” “should,” “could,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “expect,” “intend,” “seek,” “plan,” “think,”
“anticipate,” “estimate,” “predict,” “target,” “potential” or “continue” or the negative of these terms or other comparable terminology. Such forward-looking statements include, but
are not limited to, statements about the Company’s future revenues, income, indebtedness, capital structure, plans, expectations, objectives, projected financial performance
and/or business results and other future events, and views of economic and market conditions.

Although NRG believes that its expectations are reasonable, it can give no assurance that these expectations will prove to be correct, and actual results may vary materially. Factors
that could cause actual results to differ materially from those contemplated herein include, among others, general economic conditions, hazards customary in the power industry,
weather conditions, competition in wholesale power markets, the volatility of energy and fuel prices, failure of customers to perform under contracts, changes in the wholesale
power markets, changes in government regulations, the condition of capital markets generally, our ability to access capital markets, unanticipated outages at our generation
facilities, adverse results in current and future litigation, failure to identify, execute or successfully implement acquisitions, repowerings or asset sales, our ability to implement value
enhancing improvements to plant operations and companywide processes, our ability to implement and execute on our publicly announced transformation plan, including any cost
savings, margin enhancement, asset sale, and net debt targets, our ability to proceed with projects under development or the inability to complete the construction of such projects
on schedule or within budget, risks related to project siting, financing, construction, permitting, government approvals and the negotiation of project development agreements, our
ability to progress development pipeline projects, the timing or completion of GenOn's emergence from bankruptcy, the inability to maintain or create successful partnering
relationships, our ability to operate our businesses efficiently, our ability to retain retail customers, our ability to realize value through our commercial operations strategy, the ability
to successfully integrate businesses of acquired companies, our ability to realize anticipated benefits of transactions (including expected cost savings and other synergies) or the
risk that anticipated benefits may take longer to realize than expected, our ability to close the Drop Down transactions with NRG Yield, and our ability to execute our Capital
Allocation Plan. Debt and share repurchases may be made from time to time subject to market conditions and other factors, including as permitted by United States securities laws.
Furthermore, any common stock dividend is subject to available capital and market conditions.

NRG undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
The adjusted EBITDA and free cash flow guidance are estimates as of March 27, 2018. These estimates are based on assumptions the company believed to be reasonable as of that
date. NRG disclaims any current intention to update such guidance, except as required by law. The foregoing review of factors that could cause NRG’s actual results to differ
materially from those contemplated in the forward-looking statements included in this presentation should be considered in connection with information regarding risks and
uncertainties that may affect NRG's future results included in NRG's filings with the Securities and Exchange Commission at www.sec.gov.
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N R G : R E D E F I N I N G P O W E R
M A U R I C I O G U T I E R R E Z
P R E S I D E N T A N D C H I E F E X E C U T I V E O F F I C E R

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NRG: SIMPLIFIED AND TRANSFORMED
2015 Analyst Day 2018 Analyst Day
53 GW 2.8 MM ~100 23 GW 2.9 MM ~40
GENERATION RETAIL PLANTS GENERATION RETAIL PLANTS
CAPACITY CUSTOMERS CAPACITY CUSTOMERS
●GAS ●SOLAR
●COAL ●WIND
●OIL ●NUCLEAR
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1
Moving to a customer-driven
integrated power model
2
K EY TA K EAWAYS
Generating robust and
stable cash flows
3
Committed to disciplined, transparent
capital allocation principles
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Highlights
Strategy
THE IMPROVED NRG BUSINESS PLATFORM
Execution
Financial
An Integrated Business Model… …With A Strong Financial Profile
>$1.9 Bn1 > $1.3 Bn
Adj. EBITDA FCFbG
2020+ Pro Forma 2020+ Pro Forma
Customer
3.0x ~$8 Bn2
Net Debt/ Excess Cash
Adj. EBITDA Through 2022
CUSTOMER-DRIVEN INTEGRATED POWER COMPANY BUILT ON A PORTFOLIO OF
LEADING RETAIL BRANDS AND DIVERSE GENERATION ASSETS
1 Please refer to slide 8 of the 2018 NRG Analyst Day Finance presentation; 2 Includes $1 Bn of excess cash allocated to share buybacks

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S T R AT E G Y
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Highlights
VALUE IN OUR INDUSTRY MOVING FROM
Strategy
Execution
POWER PLANTS…
Financial
PURE IPP INTEGRATED MODEL ?
Low Gas Prices
More Renewables
70
Consumer-Driven
S 60
T
N 50
E Natural Gas Price1
M
40
E
R
TI 30
E
ND RW) 20
S A(G 10 ADDITIONS
D 0
UIL -10 RETIREMENTS
B
W
-20
E
N
S -30
U
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030
Coal Natural Gas Renewables Nuclear Hydro Oil
…TO CUSTOMERS GIVEN LOW COMMODITY PRICE FUTURE
1 Prompt 12-month rolling average (MMBtu)
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Highlights
Strategy
MARKET TRENDS ARE MIXED TODAY…
Execution
Financial
FUEL SUPPLY END-USER
GENERATION RETAIL
Trends Trends
• Asset retirements • Consumer choice
• Market reforms • Smart devices and digital technology
• Low natural gas prices • On-site reliability
• Renewables build out • Distributed generation
• New disruptive technologies (e.g. batteries) • New competitors
…BUT FAVOR RETAIL IN THE LONG TERM
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Highlights
NRG TRANSFORMATION CONSISTENT WITH
Strategy
Execution
MARKET TRENDS…
Financial

REBALANCED AND BETTER-MATCHED PORTFOLIO
RATIONALIZED 2015 2018
GENERATION
TWh TWh (Pro Forma, Announced Sales)
FLEET
123
STEADY GROWTH 62 63 53
IN RETAIL
Retail Generation Retail Generation
…AND POSITIONS US TO FURTHER ENHANCE OUR BUSINESS
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